The role of educational diversity
in investor relations
Arvid O.I. Hoffmann, Aida Tutic and Simone Wies
School of Business and Economics, Maastricht University,
Maastricht, The Netherlands
Purpose – The purpose of this paper is to show the role of educational diversity in improving
investor relations (IR) quality and examine how this impacts the number of shareholder activism
incidents a ﬁrm encounters.
Design/methodology/approach – The paper reviews literature on marketing, ﬁnance, and
corporate communications to develop a conceptual framework which is tested using a combination of
secondary data and primary data collected through a survey amongst IR professionals working at
companies in the Euronext 100 stock index.
Findings – The empirical results support the conceptual framework, showing higher IR quality
levels and lower shareholder activism intensity for companies with educationally diverse IR teams.
In particular, the presence of marketing and communication experts in IR teams contributes to higher
IR quality and lower shareholder activism.
Research limitations/implications – Future research may investigate the robustness of the
results with larger and internationally diversiﬁed samples and examine how, besides educational
diversity, other organizational arrangements through which ﬁnance professionals work together with
marketing and communication professionals impact IR quality.
Practical implications – The results suggest that to improve their IR quality and minimize
shareholder activism, companies should check and when necessary increase the educational diversity
of their IR teams.
Originality/value – This is the ﬁrst paper investigating the role of educational diversity on IR
quality and the impact on shareholder activism, developing and testing an innovative conceptual
framework that integrates marketing, ﬁnance, and corporate communication theory.
Keywords Investors, Shareholders, Corporate communications, Investor relations,
Educational diversity, Marketing-ﬁnance interface, Shareholder activism
Paper type Research paper
Investor relations is the most necessary, superﬁcial, overdue, controversial, valuable,
time-consuming, and under-exploited part of today’s management (Ryder and Regester, 1988, p. 5).
Originally, the prime role of investor relations (IR) was to disclose ﬁnancial information
to enable the ﬁrm’s (prospective) shareholders to determine the market value of its
securities (Savage, 1970; Marston, 1996). However, with a changing environment the
importance and roles of IR have changed. A modern interpretation of IR includes
marketing and communication concepts (Ryder and Regester, 1988; Rao and
Sivakumar, 1999; Dolphin, 2004; Laskin, 2009) and assigns functions to it beyond
ﬁnancial disclosure. Accordingly, the main objective of IR is to establish a mutually
beneﬁcial relationship between the management of a company and its shareholders
which is characterized by two-way symmetrical communication and not only governed
by monetary factors (Kelly et al., 2010).
The current issue and full text archive of this journal is available at
Received January 2011
Revised January 2011
Accepted May 2011
Corporate Communications: An
Vol. 16 No. 4, 2011
q Emerald Group Publishing Limited